1998 Jessica Litman.

Professor of Law, Wayne State University. B.A. 1974, Reed College. M.F.A., 1976 Southern Methodist University. J.D., 1983, Columbia University. I would like to thank Jon Weinberg and Pamela Samuelson for their helpful comments on an earlier draft.

1. See generally, VANCE PACKARD, THE HIDDEN PERSUADERS (1957).

2. See, e.g., id. at 155-207; United States v. Nixon, 418 U.S. 683 (1974); U.S. v. Dean, 55 F.3d 640 (D.C. Cir. 1995); Mecham v. Gordon, 156 Ariz. 297 (1988).

3. Pub. L. No 100-568, 102 Stat. 2853 (1988).

4. See Berne Convention for the Protection of Literary and Artistic Works, Sept. 9, 1886, art. 6 bis, reprinted in WORLD INTELLECTUAL PROPERTY ORGANIZATION, GUIDE TO THE BERNE CONVENTION FOR THE PROTECTION OF LITERARY AND ARTISTIC WORKS (Paris Act, 1971) 177 (1978).

5. See S. REP. NO. 352, 100th Cong. (1988); 134 CONG. REC. H3079, H3082, H3084 (daily ed. May 10, 1988) (remarks of Rep. Kastenmeier and Rep. Berman); Final Report of the Ad Hoc Working Group on U.S. Adherence to the Berne Convention, 10 COLUM.-VLA J.L. & ARTS 513 (1986).

6. See Berne Convention Implementation Act, 134 CONG. REC. H3079, 3 (1988); S. REP. NO. 352, Part III.A (1988); 134 CONG. REC. S14549, 14557 (1988) (citing remarks of Senator Hatch). It was not until 1991 that the United States made a feeble and incomplete attempt to comply with its international obligations under the Berne Convention. See Visual Artists Rights Act of 1990, 17 U.S.C. 106A (1994).

7. See, e.g., Berne Convention Implementation Act of 1987: Hearings on H.R. 1623 Before the Subcomm. On Courts, Civil Liberties and the Administration of Justice of the House Comm. on the Judiciary, 100th Cong. 408, 519-21 (1988) (testimony of Sidney Pollack, Directors Guild of America and colloquy); Jessica Litman, Amerika Gasshukoku no Berunu Joyaku Kanyu (Accession of the United States to the Berne Convention), 16 CHOSAKUKEN KENKYU 1 (1989).

8. Pub. L. No. 105-304 (1998). To review the DMCA's legislative history, see, for example, H.R. REP. NO. 551 (1998) and S. REP. NO. 190 (1998).

9. The most notable example in the DMCA's tortured history is the effort to constrain the exercise of the fair use privilege while insisting that the law would do nothing of the sort. Despite repeated assurances in the legislative history and in the language of the bills themselves that the DMCA does not in any way contract the fair use privilege, the bills' anti-circumvention provisions were intended to narrow fair use. The bill's proponents refused to accept any statutory language that would have provided that users could continue to make fair use of copyrighted works despite those provisions. Compare, e.g., S. REP. NO. 190, 23-24 (1998) ("The bill does not amend section 107 of the Copyright Act, the fair use provision. The Committee determined that no change to section 107 was required because section 107, as written, is technologically neutral, and therefore, the fair use doctrine is fully applicable in the digital world as in the analog world.") with, e.g., H.R. REP. 551, at pt. 2 (1998). See generally Hearing on H.R. 2281 Before The Telecommunications, Trade And Consumer Protection Subcomm. of the House Commerce Comm., 105th Cong. (1998) (testimony of Robert L. Oakley).

10. See generally INFORMATION INFRASTRUCTURE TASK FORCE, INTELLECTUAL PROPERTY AND THE NATIONAL INFORMATION INFRASTRUCTURE: A PRELIMINARY DRAFT OF THE REPORT OF THE WORKING GROUP ON INTELLECTUAL PROPERTY RIGHTS (1994).

11. See, e.g., Jessica Litman, The Exclusive Right to Read, 13 CARDOZO ARTS & ENTERTAINMENT L.J. 29 (1994); Diane Leenheer Zimmerman, Copyright in Cyberspace: Don't Throw Out the Public Interest with the Bath Water, 1994 ANN. SURV. AM. L. 403; James Boyle, Overregulating the Internet, WASH. TIMES, Nov. 14, 1995, at A17; Pamela Samuelson, The Copyright Grab, WIRED 4.01, Jan. 1996, at 134.

12. Copyright is mentioned expressly in the draft in only three places. See U.C.C. 2B-101(27); 2B-101(32)(B); 2B-105(a) (concerning preemption by federal law); 2B-501(c)(2)(B) (Aug. 1, 1998 Draft).

13. See id., Preface at 7-17; Reporters Notes to 2B-103; 2B-104; 2B-105; 2B-107; 2B-111; 2B-112; 2B-201; 2B-206; 2B-208; 2B-307; 2B-308; 2B-310; 2B-401; 2B-501; 2B-502; 2B-503; 2B-506; 2B-507; 2B-615; 2B-617; 2B-618; 2B-702; 2B-708. The details of the accounts have changed with each successive draft, but the bottom line appears to have remained constant.

14. One example is the Preface's repeated reference to ProCD v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996). See, e.g., U.C.C. Article 2B, Preface at n.18 (Aug. 1, 1998 Draft). ProCD is the leading case to enforce a shrink-wrap license, because it is the first case to do so. Before ProCD, most courts deemed shrink-wrap licenses unenforceable. See, e.g., Step Saver v. Wyse, 939 F.2d 91 (3d Cir. 1991); Vault Corp. v. Quaid Software, Ltd., 847 F.2d 255 (5th Cir. 1988). Since ProCD, the case law has been mixed. See generally Mark Lemley, Beyond Preemption: The Federal Law and Policy of Intellectual Property Licensing, 87 CALIF. L. REV. 113 (1998); Pamela Samuelson, Intellectual Property and Contract Law for the Information Age, Forward to a Symposium, 87 CALIF. L. REV. 1 (1998). The Preface and Reporter's Notes, however, cite none of the cases going the other way.

15. See, e.g., Dennis Karjala, Federal Preemption of Shrinkwrap and On-Line Licenses, 22 U. DAYTON L. REV. 511 (1997); David A. Rice, Digital Information as Property and Product, UCC Article 2B, 22 U. DAYTON L. REV. 621 (1997); Pamela Samuelson, Legally Speaking: The Never Ending Struggle for Balance, 40 COMMUNICATIONS OF THE ACM, May 1997, at 17; Jerome Reichman & Jonathan A. Franklin, Privately Legislated Intellectual Property Rights: The Limits of Article 2B of the UCC (Apr. 4, 1998) (unpublished manuscript, on file with author).

16. See Pamela Samuelson, Legally Speaking: Does Information Really Have to be Licensed?, 41 COMMUNICATIONS OF THE ACM, Sept. 1998, at 15; sources cited supra note 14.

17. U.C.C. Article 2B, Preface at 10 (Aug. 1, 1998 Draft).

18. See id. ("Even though a purchaser acquires a copy of the work, the producer retains rights and control with respect to various uses of the copy, including uses that make additional copies or alterations.") (emphasis added); U.C.C. 2B-102 (Aug. 1, 1998 Draft) (defining "Copy," "License," "Information," "Published Informational Content," and "Termination); Jane C. Ginsburg, Authors as "Licensors" of "Information Property Rights" under UCC Article 2B, 13 BERKELEY TECH. L.J. * (1998).

19. See U.C.C. Article 2B, Preface at 5 (Aug. 1, 1998) ("The terms of a license also typically provide for express grant of rights (or permission) to use information and express limitations on use.") (emphasis added); id. 2B-103, Reporter's Note 1 ("The covered transactions involve information and rights to use information.").

20. See id. 2B-104(2).

21. See id.

22. See id. 2B-102(27).

23. See generally Ginsburg, supra note 18, at *. David Nimmer et al., The Metamorphosis of Contract into Expand, 87 CALIF. L. REV. 17 (1998) (forthcoming 1999).

24. Section 2B-102 evades this point by defining "information" broadly as "data, text, images, sounds, mask works, or works of authorship." U.C.C. 2B-102 (Aug. 1, 1998 Draft) (emphasis added).

25. See Feist Publications v. Rural Tel. Serv., 499 U.S. 340 (1991); Baker v. Selden, 101 U.S. 99 (1879).

26. See U.C.C. 2B-102(27) (Aug. 1, 1998 Draft).

27. Trade secrecy seems the most promising of the remaining doctrines, but Article 2B clearly envisions the assertion of rights over material far too widely disseminated to qualify as a trade secret under the law of most states. I assume that the drafters don't intend to rely on the discreditable and largely discredited notion of mass market trade secrecy raised some years ago in support of a trade secrecy justification for shrink wrap licenses. But see, e.g., id. 2B-110, Reporter's Note 4.

28. See 17 U.S.C. 901-14 (1984).

29. U.C.C. 2B-102(27) (Aug. 1, 1998 Draft).

30. Id. 2B-102 (27), Reporter's Note 25.

31. Id., Preface at 10. The August, 1998 draft talks about a license of these sorts of rights as an "access contract." Section 2B-102(1) defines access contract as "a contract to electronically obtain access to, or information in electronic form from, an information processing system. The term does not include a contract for physical access to a place, such as a theater or building." Id. 2b-102, Reporter's Note 1. The fact that access to information is subject to an access contract does not itself create any informational rights; rather, the established rights to impose conditions on access to information make access contracts enforceable. What is the source of these rights? The Reporter's Notes, somewhat confusingly, tell us that access rights are "fundamental":

An access contract is a contract that authorizes access to an electronic facility, including a computer or an Internet site, or a contract that authorizes obtaining information from that type of facility... An "access contract" is typified by "on-line" services and Internet transactions. It also includes contracts for remote data processing, third party E-mail systems, and contracts allowing automatic updating from a remote facility to a database held by the licensee....

Access contracts do not depend on intellectual property rights. The owner of a computer system has a fundamental right recognized in criminal law and property law to exclude others from access to its system and to condition the terms on which it permits access to occur. Access contracts may distribute rights on the basis of informational rights, but they also reflect the right to control use and access.

Id.

32. See id. When lawyers term something "fundamental" without citation of authority, it is tempting to conclude that there is no authority to cite.

33. Indeed, the Preface appears to suggest that if a copyright owner elects to distribute its work through licensing, it can thereby avoid any statutory privileges that the copyright statute affords to the public. This seems curious since U.C.C. 2B-102(27) excludes rights created by contract.

34. See Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908).

35. The Reporter's Notes cite one case upholding a shrink wrap license, ProCD v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996). See U.C.C. Article 2B, Preface at n.16 (Aug. 1, 1998 Draft). However, the Notes omit citation of cases holding such licenses unenforceable. See Step Saver v. Wyse, 939 F.2d 91 (3d Cir. 1991); Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (5th Cir. 1988); Mark Lemley, Intellectual Property and Shrink Wrap Licenses, 68 S. CAL. L. REV. 1239 (1995).

36. See generally Vault Corp. v. Quaid Software, 775 F.2d 638 (5th Cir. 1985); Julie Cohen, Reverse Engineering and the Rise of Electronic Vigilantism: Intellectual Property Implications of "Lock Out" Technologies, 68 S. CAL. L. REV. 1091 (1995).

37. See U.C.C. Article 2B, Preface at 10 (Aug. 1, 1998 Draft) ("[I]n the consumer market, copies [of motion pictures] are either sold or rented under terms that preclude public performance."). In general, the Reporter's Notes seem to proceed from the erroneous assumption that copyright law gives the copyright owner control over specific uses of copies of the work rather than exclusive rights that are independent of the ownership of copies of the work. The distinction isn't trivial. It leads the author of the Reporter's Notes to some characterizations of rights under copyright that are at best peculiar, and in any event confusing. See, e.g., id. ("A sale relinquishes some rights with respect to the copy. A license tailors what rights are granted.") (emphasis in original).

38. Accord Nimmer et al., supra note 23, at 26.

39. For example, the Westlaw copyright license insists that even for material over which West has no copyright interest,

No part of a Westlaw transmission may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred or used, in any form or by any means, except as permitted in the Westlaw Subscriber Agreement or with West's prior written agreement.

WEST GROUP, COVERSHEET FOR WESTLAW COMPUTER PRINTOUT (emphasis added).

40. Entire industries can be based on such customs. Hollywood commonly purchases "life story rights" from individuals whose true stories are envisioned as the basis for a film or television movie. Courts have so far resisted the syllogism that because so many studios purchase such rights, a project "based on a true story" may not legally proceed without them. See, e.g., Seale v. Gramercy Pictures, 964 F. Supp. 918 (E.D. Pa. 1997).

41. See, U.C.C Article 2B, Preface at 14-25 and accompanying text (Aug. 1, 1998 Draft).

42. See id. at 7-14.

43. See id. 2B-105, Reporter's Note 2.

44. See NBA v. Motorola, 105 F.3d 841 (2d Cir. 1997); Rano v. Sipa Press, 987 F.2d 580 (9th Cir. 1993); Baltimore Orioles v. Major League Baseball Players Ass'n, 805 F.2d 663 (7th Cir. 1986), cert. denied, 107 S. Ct. 1593 (1987); Harper & Row v. Nation Enters., 723 F.2d 195 (2d Cir. 1983), rev'd on other grounds, 471 U.S. 539 (1985). Cf. Bonito Boats v. Thundercraft Boats, 489 U.S. 141 (1989) (finding patent preemption of state plug molding laws).

45. I refer here to H.R. 2281, 105th Cong. (1997) as it passed the House of Representatives on August 4, 1998. See generally Jessica Litman, Reforming Information Law in Copyright's Image, 22 DAYTON L. REV. 587 (1997).

46. See U.C.C. Article 2B, Preface at 13 (Aug. 1, 1998 Draft).

47. See Nimmer et al., supra note 23, at 29-30.

48. 17 U.S.C. 101 (1976).

49. U.C.C. 2B-102(a)(14) (Aug. 1, 1998 Draft) (emphasis added).

50. See id., Reporter's Note 12.

51. This is another case of assuming the truth of the proposition one is attempting to prove. The controversy alluded to by the Reporter's notes is not whether reproductions that are neither permanent nor stable are fixed copies within the meaning of the statute; everyone would agree that they are not. The controversy is instead over the correctness of decisions that reproductions in computer Random Access Memory are sufficiently permanent and stable to be fixed under the statutory definition. By expanding its definition of copies to encompass even temporary reproductions, the draft of U.C.C. 2B-102 goes further. That decision conceals another instance of sleight of hand. In the Preface, the Reporter notes that computer software and electronic databases differ from books because one can read a book without creating a copy, but cannot use a computer program or digital information source without creating a copy or accessing it from a remote site. See id. 2B, Preface at 7. If one uses the definition of copy in U.C.C. 2B-102, that seems true, but if one instead refers to the definition in the copyright statute at 17 U.S.C. 101, the question is far from settled.

52. At the same time, the promiscuous use of improved definitions and terms seems calculated to throw established business practices out of whack. When contracts refer to "copies" do they mean "copies" as the copyright statute defines them or as defined by Article 2B? Should we assume that hard copy contracts mean one thing by "copy," while electronic contracts mean the other? Is a contract that arrives as an e-mail attachment or by fax an electronic contract, or a conventional one? Prevailing copyright law has informed and shaped settled trade practice in what Article 2B calls the "copyright and information industries." Id. 2B-103, Reporter's Note 1. How will Article 2B's overlay of sometimes augmented, sometimes improved, and sometimes flatly inconsistent "licensing" provisions change the way that transactions will be interpreted? Perhaps it is for that reason that, in the spring of 1998, the broadcast industry, the cable television industry, the motion picture industry, and the recording industry requested, and were promised, express exclusions from the scope of Article 2B for transactions relating to their core business. See id. 2B-104, Reporter's Note 7.